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'Death of commuting will see car sales decline continue'

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A senior economist warned that with reduced commuting times likely for most of us in 2021, an immediate recovery in car sales is unlikely

A senior economist warned that with reduced commuting times likely for most of us in 2021, an immediate recovery in car sales is unlikely

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A senior economist warned that with reduced commuting times likely for most of us in 2021, an immediate recovery in car sales is unlikely

There were 30% fewer cars sold here in 2020 compared to the year before as the economy and consumer spending took a hit during the pandemic.

A senior economist warned that with reduced commuting times likely for most of us in 2021, an immediate recovery in car sales is unlikely.

According to the Society of Motor Manufacturers and Traders (SMMT), 36,191 new cars were registered here in 2020, down from 5,152.

Declines in other UK nations were at a similar level, the SMMT figures show.

The Ford Focus was Northern Ireland's most popular choice of new car, with 1025 sold - closely followed by the Volkswagen Golf.

The Ford Fiesta, Hyundai Tuscon and Nissan Qasqai completed the top five bestsellers here.

The Vauxhall Corsa was 2020's top seller in Scotland and Wales, while England's number one set of wheels was the Ford Fiesta.

Ulster Bank chief economist Richard Ramsey said it had been a year to forget for car dealers here, with over 15,300 fewer cars sold.

It was the fifth year of decline in a row - the worst performance since at least 2002 and nearly 50% below the peak of 2007, Mr Ramsey said.

He added: "2021 is set to be a challenging year for the economy with unemployment set to soar in the summer following the expiry of the furlough scheme in the spring.

While many households have increased their savings over the last nine months it remains to be seen whether purchasing a new set of wheels is the priority it once was.

Consumer behaviours have been impacted by the pandemic and this will influence their spending."

Mr Ramsey said the new era of working from home which took off during the pandemic's first wave, had killed the commute for many.

He predicted that workers would adopt hybrid working, split between home and office - which would bring a reduced commute.

"Both these scenarios will impact on households' driving patterns and motoring needs. Equally, public transport may be shunned with consumers preferring to travel in their own private 'bubbles'," he said.

But he said the UK's decline in car sales had been the worst since the Second World War.

"2020 has been a year of record rates of decline on a number fronts, not least within the car industry. Brexit and lockdowns were two headwinds for the sector that dampened demand.

"New UK car sales slumped by 29% last year, which represented the steepest annual fall since World War II (1943) with sales volumes plumbing their lowest level since 1992.

"2020 marked the fourth consecutive year of declining car sales in the UK with a cumulative decline of 40% (1.1 million cars) since 2016's peak."

But he added that electric vehicle sales did provide a bright spot as drivers adopted more environmentally-friendly cars.

Battery electric vehicles and plug-in hybrid electric vehicles saw sales soar by 186% and 91% respectively last year.

"As a result, electric vehicles now account for one in 10 of all new car sales, up from one in 30 in 2019."

Mike Hawes, SMMT chief executive, said 2020 would be regarded as a "lost year" for the industry. "However, with the rollout of vaccines and clarity over our new relationship with the EU, we must make 2021 a year of recovery."

Belfast Telegraph


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